EU Member States Preparedness for Cohesion Policy 2014-2020

Currently all EU Member States are preparing the new programming period 2014-2020. With the Lisbon Treaty the European Parliament has become a full co-legislator with the Council. The currently ongoing negotiations between the Council, the European Commission and European Parliament (trilogues) aim at reaching a common agreement on the Community support framework and the regulations. The preparation of the legal framework for the European Structural and Investment Funds has taken nearly two years from the launch of the first draft regulations up to now – with several versions of these documents distributed to the Member States. These versions include the Common Provisions Regulation (CSR) which sets out common rules for the Cohesion Fund (CF), European Regional Development Fund (ERDF), European Social Fund (ESF), European Agricultural Fund for Rural Development (EAFRD) and the European Maritime and Fisheries Fund (EMFF) and the individual regulations for the funds. The CSR implies some novelties which affect programme preparation and management.

The following key issues are crucial to the programme preparation:

According to the CSR the Partnership Agreement (PA) represents the contract between the Member States and the European Commission. The PA is currently under preparation in all Member States. It summarizes the essential parts of the programme management of all five Funds mentioned above according to the principles and ex-ante conditionalities provided by the CSR. Although the process has been complex due to its multi-governance character, it has been appreciated by many stakeholders for its informative and participative character. Comparing the process in different Member States, it appears that EU12 are far more prepared for the programming process and the operational programmes than some of the EU15 (e.g. UK, Spain).

Some Member States are confronted with significant reductions of their financial allocations (Germany, Spain, Greece). The debate on the distribution of budgets within Member States to regions and sectors has not been concluded yet (e.g. Germany, Austria).

Some Member States are planning significant changes in the scope and content of the operational programmes. The change towards multi-funded programmes including both, ERDF and ESF (e.g. France, Poland, Portugal, Hungary, Bulgaria, Czech Republic, Finland, Slovenia) and the reduction of the number of OPs at regional level (e.g. UK, Austria, Czech Republic, Finland, Slovenia) have to be considered important changes. In terms of instruments, the Community led local development (CLLD) has been more widely implemented than the newly proposed Integrated Territorial Investments (ITI). This is partly because CLLD benefit from previous experience from Local Actions Groups applied in rural development.

The concentration of thematic objectives seemed to have worked well in most of the Member States and leads to a significant shift towards innovation and research. The investment priorities together with the country specific recommendations of the European Commission helped to reduce demands from different stakeholders and strengthened the Managing Authorities’ position.

The requirements to base the programmes on a clear intervention logic induced several Member States to seek external support from the Commission and ex-ante evaluation experts. Still, this approach has been appreciated in some Member States. Nevertheless the definition of result indicators still poses significant problems. Member States worry about a potential link to payments and face major difficulties in providing sufficient statistical data. Currently result indicators are still in discussion in many Member States. The time intensive preparation of the intervention logic keeps some Member States from preparing administrative structures and implementation procedures.

In general administrative structures have been conceived to be functional and there are no major plans on changing them, except for those cases, where operational programmes are merged or centralised. Most of the Managing Authorities (MA) perceive the new regulations as even more bureaucratic and complex than the previous ones. Simplifications in terms of application procedures are currently under preparation in almost all Member States, since this is considered as one of the major issues in improving absorption rates.

Member States have ambivalent opinions about thematic ex-ante conditionalities. On the one hand, they are conceived as valuable framework for regional and national development. On the other hand, they are considered to intrude in internal national affairs. However, Member States have not yet finished preparing all the ex-ante conditionalities.

In general, the timeframe for final approval of operational programmes is estimated to take until mid-2014, if not later.

Based on the findings of this note the following general recommendations can be derived:

European Level

The legal framework should be finalised and approved as soon as possible. Further changes should, in any case, be avoided by EU legislators.

Member States and the European Commission should seek to strengthen Managing Authorities, in their national and regional position, in programming and managing the ESI-Funds.

European Commission desk officers should be able to provide a uniform and consistent position related to the regulations and intervention logic of ESI-Funds.

Regular support of Member States by the European Commission and external consultants proved to be sufficient for accelerating the process. This support should be continued throughout the whole programme period. Some EU15 Member States face significant delays (e.g. Spain and Italy). It may be assumed that those Member States should also be provided with additional support by the European Commission.

Central bodies responsible for control functions should utilise and rely upon external experts accompanying the implementation process in regions with low performance in implementing regional operational programmes.

Member State Level

The multi-level governance approach should be continued throughout the programme period in a standardised and regular way. Multi-level governance is however often used as pretence to push specific political agendas into the programming process. Multi-level governance must not be an end in itself and should be applied with prudence. The roles and tasks of the actors involved in the programming should be clearly specified in view of promoting efficient procedures.

A constant and already established dialog between different governmental levels should be assured and financially supported by the technical assistance measures. For that purpose the Monitoring Committee should be strengthened. In many cases it is seen as a compulsory chore rather than a platform for joint discussion and understanding. Joint Committee meetings between ESF and ERDF are essential in the regional operational programme.

It can be expected that the change in accounting will cause some difficulties for Managing Authorities. Especially those Member States with a large number of programmes and with difficulties in the previous period 2007-2013 will face additional or at least the same difficulties in the future. In these cases support rather than control could assist in bringing Member States on track. The involvement of accounting specialists should help to introduce the annual accounting system.

Member States face the challenge to establish systems compliant with the EU regulations operating at the lowest possible level of bureaucracy. Control mechanisms should not be a playground for individual institutions that go beyond the actual needs for compliance with the regulation, thus hindering effective implementation.

As a result, administrative changes and the implementation of new and more effective structures have to be accompanied and evaluated closely in order to assess potential gains (or losses) in efficiency and effectiveness.

Operational Programme Level

Financial allocation should truly be based on the need assessment. Adjustment of allocations in any operational programme should be comprehensible. Ex-ante evaluation is the one instrument to assure the rationality of financial allocation at least at operational programme level.

Member States should focus on these objectives with good chances to generate good quality project proposals where co-financing is assured. Member States should concentrate their funding on a few objectives which have the most significant impact. Objectives which are not (or less) relevant regarding the needs of the Member State should be excluded from operational programmes.

Result indicators should not be linked to payments by the European Commission. Especially in the EU15, some Member States have very small budgets which would not have any significant impact on any proposed result indicator.

Member States should only choose result indicators which are easily achievable and where data is available.